Business Recorder reported that The Pakistan Steel Mills Corporation is facing serious financial crunch and urgently requires PKR 5 billon for purchase of raw material to run the plant.

As per report, the mill urgently requires about PKR 4.5 billion to PKR 5 billion to import iron ore and coal for continuation of production. PSM needs PKR 3.33 billion for import of five shiploads of coal and PKR 1 billion for import of 80,000 tonnes of iron ore.

Sources said that raw material shortage in the steel mills has reached hazardous level and a few days' raw material is available with the corporation. They said that some rapid measurers are needed for continuation of the production process.

They said that Pakistan Steel is facing severe financial situation as the prices of raw material are on surge in the international market while funds with PSMC are insufficient to open letter of credit for raw material import. Currently Pakistan Steel is running at only 26% production capacity due to shortage of raw material, especially coal.

The federal government had announced a bailout package of PKR 25 billion but unfortunately the release of funds is very slow and so far only PKR 10.5 billion has been released in two tranches. The remaining PKR 14.5 billion has not been released yet.

(Sourced from Business Recorder)